India's Vistara cuts flights as pilots' protest over salary revision leads to cancelations, delays

India's Vistara airline has cut flights following cancelations and delays all week as pilots have been on a strike of sorts over salary revisions. 

Pilots have called in sick to protest the terms of their new contract that will come into effect following the carrier's upcoming merger with Air India, causing the airline to cancel 150 flights, while as many as 200 have been delayed since Sunday, according to local media reports.

Tata Group, which owns a 51% stake in Vistara — the remaining 49% is owned by Singapore Airlines — announced its merger with Air India. Singapore Airlines will have a 21.5% stake in Air India.

In the new salary structure pilots have been awarded a fixed pay for a minimum 40 hours of flying — earlier the minimum was 70 hours — a pilot who has been with Vistara for more than five years told CNBC. Pilots used to "get the same amount of money" whether they flew for 10 or 70 hours earlier — even though the minimum was 70 — he said.

The new structure will cut the salary from about $7,400 (for 70 hours but not always enforced) to $5,200 for a strict 40 hours, he said.

More than 200 pilots have not signed the new contract, but their salaries have been reduced as per the new contract, another pilot told CNBC. 

Pilots were given just 15 days to sign the new contract, with Vistara's management sending a "threatening" email on dissidents likely missing out on a one-time payout of $4,000 to $5,000, and deemed not interested in joining Air India once the merger is complete, the first source said. 

CNBC has reached out to Vistara for a response.

"We did not think this would happen. This is not something you'd hear from any other Tata company in India," the source said.

Vistara's CEO on Wednesday addressed pilots and said